Today I will take a look at Country Club Hospitality & Holidays Limited’s (NSEI:CCHHL) most recent earnings update (31 March 2017) and compare these latest figures against its performance over the past few years, as well as how the rest of the hospitality industry performed. As an investor, I find it beneficial to assess CCHHL’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time. Check out our latest analysis for Country Club Hospitality & Holidays
Commentary On CCHHL’s Past Performance
For the purpose of this commentary, I like to use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This enables me to examine many different companies in a uniform manner using new information. “For Country Club Hospitality & Holidays, its “, latest twelve-month earnings is ₹48.8M, which compared to last year’s figure, has declined by a significant -81.92%. Since these values may be fairly short-term, I’ve calculated an annualized five-year figure for Country Club Hospitality & Holidays’s earnings, which stands at ₹327.4M. This doesn’t seem to paint a better picture, as earnings seem to have steadily been deteriorating over time.
Why could this be happening? Well, let’s take a look at what’s going on with margins and whether the entire industry is experiencing the hit as well. Revenue growth in the past couple of years, has been positive, nevertheless earnings growth has been deteriorating. This means Country Club Hospitality & Holidays has been growing expenses, which is hurting margins and earnings, and is not a sustainable practice. Scanning growth from a sector-level, the IN hospitality industry has been enduring some headwinds over the previous few years, leading to an average earnings drop of -3.33% in the most recent year. This means whatever headwind the industry is experiencing, it’s hitting Country Club Hospitality & Holidays harder than its peers.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Typically companies that endure a drawn out period of diminishing earnings are undergoing some sort of reinvestment phase . However, if the whole industry is struggling to grow over time, it may be a sign of a structural shift, which makes Country Club Hospitality & Holidays and its peers a higher risk investment. You should continue to research Country Club Hospitality & Holidays to get a better picture of the stock by looking at: